Strong results anticipation pushes KSE up

KARACHI: The Karachi share market surged on Wednesday in anticipation of strong financial results by major companies, dealers said. “Positive activity was witnessed as investors await major earnings announcements this week,” said Ahsan Mehanti, a director at Arif Habib Investments.

The KSE 100-share index gained 46.01 points, or 0.43 percent, to close at 10,704.16. The KSE 30-share index rose 39.14 points, or 0.38 percent, to end at 10,178.53. Shares of 370 companies were traded, out of which 214 advanced, 138 declined, while 18 remained unchanged.


Analysts said that foreign interest in blue chip oil and gas and banking scrips, better than expected earnings announcements in power sector and likelihood of early approval of leverage product kept the investor sentiment positive throughout the trading session despite concerns over rising circular debt in the energy sector.
Samar Iqbal, a dealer at Topline Securities, said that the rally was led by Nishat Power whose share price increased by around seven percent mainly because of higher than expected profits.

“Institutional buying in National Bank of Pakistan share pushed its price up by about Rs3. A report about OGDC taking interest in BP Pakistan assets created some positive activity in OGDC as well.”
Sara Shahid, an analyst at Elixir Securities, said that Tuesday’s negative closing seemed like a minor hiccup, as the market continued its upward momentum. “The banking sector saw healthy activity with NBP gaining 4.47 percent on talks of foreign interest in the scrip. UBL also generated decent volumes in anticipation of higher earnings announcement.

“NPL was the volume leader, as it announced its results for the first quarter of 2010-11 with earning per share (EPS) of 15 paisas. NPL’s earning seems depressed since it booked its revenues at the tariff notified by Nepra in 2007. Had revenues been booked at the revised tariff rates, its EPS would have been significantly higher.”

Hubco’s results, however, failed to produce any excitement as the earnings came slightly below the market expectation. The ready market volume fell to 142.108 million shares from 150.70 million shares a day earlier. The highest volume was witnessed in NPL with trade of 20.207 million shares.

The scrip gained Re1 to close at Rs14.56. It was followed by NBP with trade of 13.123 million shares. It rose Rs3 to end at Rs70.11. LOTPTA was the third with trade of 13.026 million shares. It increased by four paisas to finish at Rs10.20.